Tech Companies

Tech Companies

Tax avoidance by large multinational tech companies has been one of the most important tax stories of the last decade.

The digitisation of the economy has created more opportunities for companies to shift profits offshore and sparked a series of initiatives by the OECD and governments around the world to reform their tax systems.

Our aim is to research and monitor the tax strategies of large multinational tech companies in order to better inform both the public and policy makers.

TaxWatch’s summary of the UK General Election party manifestos

TaxWatch reflects on the party manifestos for the upcoming General Election

The uncertain future of the UK’s Digital Services Tax

TaxWatch reflects on the Liberal Democrat proposal to hike Digital Services Tax

New age related Personal Allowance – rolling back the years?

Conservative Party to re-introduce age related allowances: TaxWatch’s thoughts on the proposal

What happens to the Finance Bill now an election’s been called?

The abrupt end to the Parliamentary session leaves several key Finance Bill clauses to the final washup day.

Can’t or won’t? HMRC’s lack of openness with recent FOI requests

HMRC is being elusive about the amounts due on specific offshore compliance penalties, providing confusing answers to Freedom of Information requests.

Will £51m really fix HMRC’s customer service helpline?

The Treasury’s additional funding for HMRC customer service is just a sticking plaster over an ingrained problem that needs a longer-term strategy and consistency of funding to resolve.

Are we nearly there yet? In search of the elusive offshore tax gap

HMRC now says offshore tax gap data will be published in June 2024, two years after the government announced it and a year after the information was due.

How to create a world class tax authority

TaxWatch published an article in Taxation magazine last week about the launch of the Funding the Nation report by ARC, the union for senior staff within HMRC.

Is HMRC fighting the right fight on avoidance schemes?

While HMRC appears to have stepped up activity against the promotion of tax avoidance arrangements, it seems that increased civil action is at best only containing the total number of schemes.

Gold plating tax reliefs for the silver screen

What are the implications of the additional fiscal support given to the creative industries in the Spring Budget, and do the changes provide value for money?

Latest Government consultation grapples with how to regulate tax advisers

TaxWatch introduces the latest Government consultation into regulating tax advice market.

TaxWatch responds to the Spring Budget 2024

The TaxWatch team focuses its thoughts on a few areas of the Budget statement it found particularly interesting, from a tax compliance and administration standpoint.

Would scrapping furnished holiday let tax benefits really raise £300m?

Abolishing preferential tax rules for furnished holiday lets owners will only raise the speculated revenue if the compliance rules are carefully thought out.

Fit for the future: Does HMRC have the right staff skills and technology?

HMRC’s effectiveness is being held back by legacy IT systems, staff and pay reductions and a lack of effective workforce planning.

Mind the gap: How to collect the right tax?

There are fundamental issues around the subject of compliance for HMRC, which needs, among other things, a proper workforce plan with trained and motivated staff able to deal with all aspects of compliance.

Seeing the wood from the trees: Putting HMRC wealthy compliance statistics in context

A report about trends in case numbers opened by a niche HMRC team requires a bit of context to judge whether the question it poses is the correct one.

Hanging on the telephone: The front line of HMRC’s customer service?

HMRC’s increasingly poor telephone service is impacting its ability to collect the right amount of tax and damaging the wider economy.

Taxing online selling: What’s really changing?

Misunderstandings and confusing media coverage last week have created uncertainty about how transactions made via online platforms such as Vinted, Ebay and Airbnb should be taxed.

TaxWatch launches regulatory complaint against Mr Douglas Barrowman

TaxWatch has lodged a formal complaint to the Institute of Chartered Accountants of Scotland in respect of its member, Douglas Barrowman.

How much tax did multinational companies underpay in the UK last year?

A recent story about multinational companies underpaying billions of pounds of UK tax caught our attention, but it turns out the figures aren’t quite what they seem.

Research & Development tax reliefs – never getting any easier

The government’s Autumn Statement 2023 continues to increase the complexity and administrative burden of the UK R&D regime.

TaxWatch responds to the Chancellor’s Autumn Statement 2023

Amongst the theatrical showmanship that characterises UK fiscal events TaxWatch pulls out a few of the more interesting announcements made in today’s Autumn Statement.

Investment allowances: Greasing the oil industry’s machine?

The extremely high level of tax relief available to the UK’s oil and gas companies compared to all other businesses has the potential to distort private sector investment, TaxWatch believes.

TaxWatch welcomes proposals to tackle promoters of tax avoidance

Two proposals in the draft Finance Bill 2023-24 aimed at tackling promoters of tax avoidance have been welcomed by TaxWatch.

TaxWatch releases latest report on the State of Tax Administration

Our latest annual report explores the UK Government’s administration and enforcement of the tax system.

Seven large tech groups estimated to have dodged £2bn in UK tax in 2021

New TaxWatch analysis shows how they appear to use complex tax driven structures to reduce their UK corporation tax.

TaxWatch’s view on Labour’s proposed Covid corruption commissioner

While it’s great news Labour is focusing on tackling fraud, real success depends on fully-funded public services to take appropriate action in those cases.

Holiday let tax rules allow owners to escape thousands of pounds in tax

The tax treatment of furnished holiday properties appears inappropriately generous and could encourage houses to be locked away to save thousands of pounds in taxes.

‘Our tax system is too complicated’ concludes Treasury Committee report on tax reliefs

The Treasury Select Committee has published a report into tax reliefs which calls for regular reviews and the removal of some.

Around £1bn per year lost to fraud and error in R&D tax relief claims

HMRC’s initial data into R&D tax relief claims shows significant underestimates in previous calculations of fraud and error in the schemes.

HMRC’s 2023 Tax Gap report: Proportion of tax going unpaid unchanged from previous year

The amount of tax lost in the 2021-22 financial year was 4.8% of the total tax owed, the same figure as the previous year.

Public Accounts Committee says HMRC not doing enough to deter tax cheats

HMRC must do more to deter and punish tax cheats.

Beyond the Loan Charge: Will the most recent proposals finally shut down disguised remuneration schemes?

HMRC estimates that 31,000 people used disguised remuneration schemes in 2020-21.

Can a posse of professional bodies clean up tax dodge city?

What – if anything – can be done about professionals that break the rules?

R&D relief – still not working?

What does the money achieve?

Spring Budget 2023

Key tax takeaways from the Spring Budget 2023.

R&D – still changing after all these years

R&D tax reliefs are not working as intended.

HMRC tax defaulting tax advisor reported to two professional bodies

TaxWatch complains to professional bodies about deliberate tax defaulter.

Director of suspected HMRC tax avoidance scheme continues to be member of professional body

An accountant ‘named and shamed’ by HMRC for alleged involvement in tax avoidance schemes is still a member of ICAEW.

Video Games Tax Relief costs five times as much as forecast

Video Games Tax Relief (VGTR) cost a record £197m last year, more than five times as much as it was anticipated to cost.

Public Account Committee questions resourcing of HMRC

A new PAC report argues that the government is “missing the opportunity to recover billions”

TaxWatch give evidence at Treasury Select Committee

TaxWatch Acting Director Alex Dunnagan gave evidence to the Treasury Select Committee on 19th December highlighting the abuse of tax reliefs.

ITR Global Tax 50 2022: Alex Dunnagan

Acting Director Alex Dunnagan has featured in International Tax Review’s list of the 50 most influential figures in global tax.

Opportunities Missed – Autumn Statement 2022

The Chancellor has missed an opportunity to close the tax gap.

TaxWatch submits regulatory complaints against arms dealer’s adviser.

TaxWatch’s third complaint to the professional bodies.

Funding of Taxpayer Protection Taskforce raises serious issues

The failure of Sunak’s taskforce highlights concerns over how HMRC compliance is funded.

Cross-party MPs call time on feeble approach to tax avoidance and urge HMRC to prosecute tax fraudsters

New report argues how supposedly ‘legal’ tax avoidance could actually be prosecuted as tax fraud

Tax Gap Op-Ed in HMRC Magazine

We have recently had an op-ed published in the magazine HMRC Enquiries, Investigations and Powers.

We need to talk about Corporation Tax

No, the UK is not set to become a high-tax global outlier.

HMRC publishes its 2022 Tax Gap – TaxWatch analysis

HMRC’s Tax Gap increases for second year in a row on a like-for-like basis.

Committing to a world of good? Etsy’s tax affairs

Etsy’s Irish tax structure revealed.

Differing approaches to combating marketed tax avoidance schemes

HMRC’s record on tackling marketed tax avoidance schemes over the last 10 years.

Amazon – Public money but no public scrutiny

Investors have a chance to increase transparency in Amazon’s tax affairs.

Another record year for Rockstar Games Tax Relief (RGTR)

Rockstar games claimed £68.4m in VGTR in 2020-2021, almost double what the whole relief was set to cost on a yearly basis.

HMRC Investment Announced

HMRC set to receive £161m investment in compliance work.

TaxWatch launches regulatory complaint against Mr Arthur Lancaster of AML

TaxWatch has lodged a complaint concerning Arthur Lancaster, Director of AML Tax (UK) Limited, and Director of the Knox House Trust of the Isle of Man.

Organised Crime in the Department of Health and Social Care supply chain

TaxWatch is calling on the Department of Health and Social Care (DHSC) to investigate the fraudulent use of Mini Umbrella Companies in its procurement process.

HMRC’s record on covid support and tax fraud under the microscope

HMRC’s record on tax fraud has been questioned by two select committees and in several parliamentary debates in recent weeks

TaxWatch launches annual report on state of tax administration

TaxWatch is today launching its annual report on the state of tax administration in the UK.

TaxWatch launches complaint against “Mr Red”

TaxWatch has submitted a complaint to the Tax Disciplinary Panel about the conduct of an individual identified as “Mr Red” in the case of Murray Group Holdings vs HMRC.

The gift that keeps on giving

GTA developer takes close to 50% of all video game tax relief in 2020.

HMRC reveals new estimate for Covid fraud recovery

Three-quarters of Covid support claimed in fraud and error won’t be collected

Funding to fight covid related tax and benefits fraud

Analysis by TaxWatch has found that the DWP is spending more than twice the amount being spent by HMRC on recovering an increase in fraudulent payments arising from the pandemic.

Use of disguised remuneration avoidance schemes more than doubled after Loan Charge

New analysis shows that the number of users of disguised remuneration schemes has increased dramatically despite government attempts to legislate against the schemes.

TaxWatch challenges HMRC over “sweetheart” deal with GE

TaxWatch has launched the first stage of legal proceedings against HMRC over their decision to settle a £1bn tax fraud dispute with GE.

How should HMRC treat the victims of tax fraud?

HMRC’s policy of “process now check later” can easily be abused by fraudsters.

The Diverted Profits Tax and Tackling Offshore Promoters of Tax Avoidance

A TaxWatch Briefing on the Finance Bill 2021-2022.

Budget 2021 – Four tax takeaways

We analyse the Autumn budget, looking at compliance work, promoters of tax avoidance, R&D relief, and the environment.

Video Games Tax Relief – 2021 Update

£180m paid out in Video Games Tax Relief last year, the vast majority to large multinationals.

US set to raise $8.5bn from four tech companies following global tax deal

US Government set to raise 3x more than rest of the world combined in tax payments from four tech companies after Global Tax Deal.

G7 tax deal represents a tax cut for big tech in the UK – new analysis

A new analysis from TaxWatch has demonstrated that tech giants will end up paying less tax under the proposals put forward by the G7 than they are currently liable for under the digital services tax.

TaxWatch calls for scrutiny over “sweetheart” tax deal between HMRC and GE

TaxWatch has written to the PAC, the NAO, and the Treasury Committee, requesting that inquiries be held into an out of court settlement between HMRC and General Electric (GE).

Undue influence by multinational corporations in the UK

TaxWatch research has been published by Transparency International, looking at the UK’s reform of its Controlled Foreign Company (CFC) regime.

Tax Fraud Gap at least £15.2bn in 2020

An analysis of HMRC’s latest Tax Gap estimates by TaxWatch has found that the amount of tax lost to fraud in 2020 was at least £15.2bn.

GE Tax Fraud Case to be heard by Supreme Court

The Supreme Court has granted permission to HMRC to appeal a decision of the Court of Appeal preventing the tax authority from making allegations of fraud against GE in relation to an ongoing tax dispute.

Tech giants undermine African countries by failing to collect VAT

African countries are missing out on significant tax revenues because multinational tech giants are failing to collect and pay VAT on services.

Will Facebook, Google, eBay and Amazon pay more in UK tax under the new global tax deal?

TaxWatch analysis shows that package agreed at the G7 would lead to a tax cut for tech companies subject to the Digital Services Tax.

Eight tech companies in the UK avoided an estimated £1.5bn in 2019 – New Research

Eight tech companies made an estimated £9.6bn in profit from sales to UK customers in 2019, yet only faced corporation tax liabilities of £297 million.

The Deloitte Disaggregation

Deloitte and Sports Direct’s major international VAT avoidance scheme revealed.

TaxWatch intervenes in GE tax fraud case

TaxWatch has taken the preliminary step to intervene in a Supreme Court case between HMRC and General Electric (GE).

Furlough fraud to cost up to £7bn – with no civil penalties issued yet

Despite the cost of furlough fraud running into the billions HMRC are yet to issue any civil penalties.

Tax avoidance can be tax fraud – says government and MPs

MPs and Ministers recognise that the promotion of tax avoidance often involves fraudulent conduct which can leave promoters liable for several criminal offences.

“Amazon Tax Cut” features in Parliamentary debate

TaxWatch’s research into “super-deductions” featured prominently in a parliamentary debate.

​TaxWatch launches the Tax and the Rule of Law project

TaxWatch launches new project focusing on the enforcement of the rule of law in taxation.

The Amazon Tax-Cut

The Chancellor’s announcement of a “super-deduction” on purchases of capital goods by businesses was one of the largest single-year tax giveaways ever enacted by a government.

Comparing the prosecution of tax crime with benefits crime

TaxWatch’s latest report reveals the huge disparity between the way in which benefits crime is treated when compared to tax crime. 

TaxWatch included in International Tax Review’s 2020-21 Global Tax 50

TaxWatch has been listed in ITR’s Global Tax 50 2020-21, which highlights “the most influential figures and events in fiscal policy over the past year, while noting who and what will be particularly important in 2021.”

Amazon’s ballooning revenues demonstrate the need for transparency in tax affairs

Amazon’s tax structure in the UK – what exactly is going on?

James Bond goes on furlough

The latest accounts of the company behind James Bond reveal more tax credit claims and claims for furlough payments.

What gets measured gets done?

We ask whether the current metrics used by HMRC are sufficiently robust to allow Parliament and other interested parties to hold the government to account

HMRC opens criminal investigations into transfer pricing schemes – Comment

HMRC open criminal investigations into transfer pricing schemes.

Netflix, tax reform and the unreal nature of digital taxation

Netflix has announced that it will start reporting billions in revenues to their local tax authorities. We ask – what does this tell us about tax structures in the digital sector?

Supermarket Super Tax Breaks

Tesco has announced that it is repaying £585m of business rates relief. Back in March we wrote why supermarkets didn’t need this tax break.

When is tax avoidance tax fraud? Remarks to the FS Tax Conference 2020

If most tax avoidance is fraud, why is it not being subject to criminal investigation?

TaxWatch director gives evidence at House of Lords

TaxWatch’s Executive Director gave evidence to the Finance Bill Sub-Committee of the House of Lords on fraud and disguised remuneration.

No Time To Pay Tax?

James Bond films are heavily subsidised by the British taxpayer, while at the same time minimising tax bills in the UK.

TaxWatch to HMRC: Prosecute sellers of disguised remuneration schemes

TaxWatch has submitted evidence to HMRC calling for those who sell disguised remuneration schemes to be investigated for fraud.

Parliament forces Netflix to respond to TaxWatch research

Netflix has agreed to respond to TaxWatch’s investigation into the companies tax affairs after a request from the DCMS Committee.

TaxWatch calls on City of London Police to investigate fraudulent tax schemes

TaxWatch is calling on the Economic Crime Unit of the City of London Police to open a fraud investigation into the promoters and marketers of disguised remuneration tax avoidance schemes.

Rogue Landlords

Up to £1.73 billion a year in tax is being dodged by unscrupulous landlords.